Hi maydel, Finally got a breather here, so I wanted to go back to that KR we talked about before things got crazy. On our last exchange, it was mentioned that the KR was important due to its context.
chart of the day
There wasn't time to go all into it then (not much now either,so I will be brief). If you remember back to the phases of the market, and how there is generally a balance in each swing ( not always equidistant though). http://content.screencast.com/users/jpartner/folders/5-20-2013/media/4a40b321-22f6-4099-bb50-becac66a587f/SLIDE%201.png"> class="embeddedObject" src="http://content.screencast.com/users/jpartner/folders/5-20-2013/media/4a40b321-22f6-4099-bb50-becac66a587f/SLIDE%201.png" width="1200" height="800" border="0" /> When this KR formed, IMO, means one of two things - either the buyers were stepping up, or since the context of this swing is inside of the other swing, and has the makings of a wash, it could end up being balance. http://content.screencast.com/users/jpartner/folders/5-20-2013/media/197966c0-5b87-492f-9ee2-cb53df2c328c/SLIDE2.png"> class="embeddedObject" src="http://content.screencast.com/users/jpartner/folders/5-20-2013/media/197966c0-5b87-492f-9ee2-cb53df2c328c/SLIDE2.png" width="1200" height="800" border="0" /> Then next bar was lack luster.. No new highs, and Lower lows....Not a good sign for a higher move http://content.screencast.com/users/jpartner/folders/5-20-2013/media/e5f9441e-bf21-4996-824d-7d6c64e747f9/SLIDE3.png"> class="embeddedObject" src="http://content.screencast.com/users/jpartner/folders/5-20-2013/media/e5f9441e-bf21-4996-824d-7d6c64e747f9/SLIDE3.png" width="1200" height="800" border="0" /> Two Bars later we get a trade higher than the KR bar, if its gonna go, it will do it now...but instead, it fizzles, lower close on the day. Did we just experience a wash? http://content.screencast.com/users/jpartner/folders/5-20-2013/media/cfa470ab-0334-413e-b6bf-ae43d96c182d/SLIDE%204.png"> class="embeddedObject" src="http://content.screencast.com/users/jpartner/folders/5-20-2013/media/cfa470ab-0334-413e-b6bf-ae43d96c182d/SLIDE%204.png" width="1200" height="800" border="0" /> Price started making B2B Lower lows, and then confirmed that BOTH washes.
http://content.screencast.com/users/jpartner/folders/5-20-2013/media/2ba13dd3-2b0b-48e1-9e32-dbd0d598dc69/SLIDE5.png"> class="embeddedObject" src="http://content.screencast.com/users/jpartner/folders/5-20-2013/media/2ba13dd3-2b0b-48e1-9e32-dbd0d598dc69/SLIDE5.png" width="1200" height="800" border="0" /> " border="0" /> So back to that KR. Given the context of price at the time, it was likely that the KR will somewhere near balance. http://content.screencast.com/users/jpartner/folders/5-20-2013/media/10eb1952-7381-44d9-94a9-62141bbe1085/SLIDE%206.png"> class="embeddedObject" src="http://content.screencast.com/users/jpartner/folders/5-20-2013/media/10eb1952-7381-44d9-94a9-62141bbe1085/SLIDE%206.png" width="1200" height="800" border="0" /> At the time the KR was formed, we had limited information as to where the true balance maybe, so we took the only two pivots that we had to work with, and could make a project from that. As time has passed, we have more information, and could probably tweak the line a bit, but for this purpose I have left it alone. There is balance in price. Sometimes its easy to see, other times, its difficult, but I wanted to go into this a bit more, so that maybe you can see it better in the future. Take Care |